AINS 102 EXAM UNDERSTANDING PERSONAL

Page 1 of 77

1

AINS 102 EXAM (UNDERSTANDING PERSONAL

INSURANCE EXAM ) ACTUAL EXAM 300

QUESTIONS AND CORRECT ANSWERS

(VERIFIED ANSWERS)

RATED

Tricia Barton has a personal auto policy providing collision coverage (with a $500 deductible) and other than collision coverage (with a $250 deductible) on her Chrysler sedan. Late one night, Tricia was responsible for an accident where she ran into an SUV and caused damage to both vehicles. She submitted a claim to her insurer for the $5,000 bill to repair her sedan.Assuming she had adequate limits and her insurer agreed to pay the claim, what amount will her insurer pay under Part D—Damage to Your Auto?

Select one:

A. $4,500

B. $4,750

C. $5,000

• $5,250 - ANSWER>>A. $4,500

5,000-500 collision deductible 1 / 4

Page 2 of 77

2

The definitions section of the Personal Auto Policy (PAP) uses

Select one:

• Technical language to explain insurance terminology to individuals who do not work in the

industry.

• Complicated language to define important words and phrases that are used throughout the

policy.

• Legal terminology to help insureds understand how to file claims under the policy.
• Simple-to-understand language to define important words and phrases that are used

throughout the policy. - ANSWER>>D. Simple-to-understand language to define important words and phrases that are used throughout the policy.

Which one of the following would qualify as a temporary substitute vehicle under a personal automobile policy?

Select one:

• A van rented by an insured during a household move
• A trailer borrowed from a neighbor to transport a horse
• A company car used by an employee to run an errand for the employer
• A car rented by an insured while her own insured auto is being repaired - ANSWER>>D. A car

rented by an insured while her own insured auto is being repaired 2 / 4

Page 3 of 77

3

Jean lent her van to a church member, Lindsey, who was transporting a group of teenagers to a church sponsored picnic. While on the way to the picnic, the van overturned, injuring one of the teenagers. The parent of the injured teenager has sued Jean, Lindsey, and the church for the teenager's injuries and future disability. Who is insured for liability under the Jean's Personal Auto Policy (PAP) for this accident?

Select one:

• Jean only
• Jean and Lindsey only
• Lindsey and the church only
• Jean, Lindsey, and the church - ANSWER>>D. Jean, Lindsey, and the church

Courtney drove her car home after spending an afternoon celebrating with some friends at a bar. She ran through a stop sign at a high speed and struck a van carrying a mother and two children. The van was totaled and all of the family members in the van were injured and hospitalized. The youngest child was severely injured and spent 3 months in the hospital and rehabilitation. The family filled a lawsuit against Courtney. She was found liable for the hospital and other medical expenses, as well as the damage to the van. Courtney was also charged with $25,000 for her reckless and grossly negligent behavior. Which one of the following types of damages does the $25,000 represent?

Select one:

• Supplementary damages 3 / 4

Page 4 of 77

4

• Punitive damages
• Compensatory damages
• Physical damages - ANSWER>>B. Punitive damages

Steve and Amy were about to purchase their first home. During the process, they were advised that they needed to purchase a HO-3 insurance policy. The HO-3 policy would provide Steve

and Amy with coverage for all of the following, EXCEPT:

Select one:

• The contents of the house
• Their cars
• The house
• Personal Liability - ANSWER>>B. Their cars

The Millers insure their dwelling under an HO-3 policy. They recently purchased a shed for their back yard where they will store tools, bicycles, and other sporting equipment. Which one of the following property coverages under Section I of the HO-3 policy would apply to the shed?

Select one:

• Coverage A—Dwelling
• Coverage B—Other Structures
• / 4